It was founded in 1995 by a trio of former managers at Option One Mortgage, including former CEO Brad Morrice and is headquartered in Irvine, California. In 2004 it converted to a real estate investment trust and was listed on the New York Stock Exchange NYSE. In that year it originated $42.2 billion in mortgages[1] and its stock reached a high of nearly $64 per share by the end of the year. In Fiscal year 2005 its net income was $417 million.[2] On January 1, 2007, New Century had approximately 7,200 full-time employees[3] and a market capitalization of $1.75 billion. But on March 13, 2007, the NYSE delisted the corporation and by the next day its market capitalization was less than $55 million. New Century is now trading on the over the counter pink sheets, where it's stock traded at $0.10 per share in 2007.

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As of January 1, 2007, New Century was the second-biggest subprime mortgage lender in the United States, and was headed by Brad Morrice, President and CEO. Frederic J. Forster, a lead independent director, served as a non-executive Chairman of the Board. Subprime mortgage loans are riskier loans in that they are made to borrowers unable to qualify under traditional, more stringent criteria due to a limited or blemished credit history. Subprime borrowers are generally defined as individuals with limited income or having FICO credit scores between 500 and 620 on a scale that ranges from 300 to 850. Subprime mortgage loans have a much higher rate of default than prime mortgage loans and are priced based on the risk assumed by the lender.

In the spring of 2007, New Century went into a "death spiral". On March 8 it announced it would stop accepting loan applications. Four days later trading of its stock on the NYSE was halted. On April 2, 2007, it filed for Chapter 11 bankruptcy. In July 2010, three officers of the company agreed to pay $90 million in settlements and were barred from serving as directors of public companies for five years.[4]

While New Century's problems became public news in February & March of 2007, primarily as a result of the pullback of more than half of its 11 warehouse lenders, (who funded New Century's loan closings until they could be securitized), mortgage insiders heard rumors of New Century's loss of some of its (wholesale/warehouse) lines of credit as early as the end of the third quarter, 2006. [references needed]

March 8, 2007. New Century Financial Corporation announced that, "as a result of the current constrained funding capacity, the company has elected to cease accepting loan applications from prospective borrowers effective immediately, while the company seeks to obtain additional funding capacity," New Century Financial Corporation said in a statement.[5] New Century Financial Corporation also said that one of its financial backers had demanded that the company repurchase some loans pursuant to repurchase provisions contained in loan purchase agreements.

March 9, 2007. the company reported that it had failed to meet certain minimum financial targets required by its warehouse lenders and disclosed that it is the subject of a federal criminal investigation. New Century Financial Corporation further indicated that it does not have the cash to pay creditors who are demanding their money.

March 12, 2007. The New York Stock Exchange stated it halted trading of New Century Financial Corporation while it decides whether to keep listing the company's securities in light of the liquidity problems.

March 13, 2007. New Century Financial Corporation reported in a regulatory filing that it has received a grand jury subpoena from the U.S. Attorney's Office for the Central District of California as well as a letter from the Securities and Exchange Commission notifying the company of a preliminary investigation. The filing stated that the U.S. Attorney's office indicated in a letter dated February 28, 2007 that it was conducting a criminal inquiry in connection with trading in the company's securities as well as accounting errors regarding the company's allowance for repurchase losses. The filing further stated that the Securities and Exchange Commission has requested a meeting with the company to discuss the company's previous announcement that it would restate certain financial statement.

March 16, 2007. The California Corporations Commissioner issued a Desist & Refrain Order to New Century Financial Corporation to cease soliciting residential mortgage applications, for a number of reasons, including, among other things, the following items that became known to the Department of Corporations: New Century Financial Corporation failed to file its 2006 financial statements by the March 1, 2007 or March 15, 2007 or when so requested by the Dept of Corporations; the loss of some of New Century's warehouse lines of credit; that New Century intended to report a loss for the fourth quarter of 2006 and that the company would be restating earnings, for the second, third, and fourth quarters of 2006.

March 20, 2007. New Century Financial Corporation said that it can no longer sell mortgage loans to Fannie Mae or act as the primary servicer of mortgage loans for the government sponsored enterprise. In a filing with the Securities and Exchange Commission, New Century Financial Corporation said that Fannie Mae terminated "for cause" a mortgage selling and servicing contract with it citing alleged breaches of that contract and others. New Century Financial Corporation said it received a notice of breach and termination on March 14, 2007.

April 2, 2007. It filed for Chapter 11 bankruptcy. New Century Financial Corporation and its related entities filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court, District of Delaware located in Wilmington, Delaware. New Century Financial Corporation listed liabilities of more than $100 million. New Century Financial Corporation also announced that the employment of about 3,200 people, more than half the workforce, will be terminated.[6]

May 25, 2007. They filed their form 8-K,[7] a day after stating that they "...probably overstated 2005 earnings."[8]

June 8, 2007. New Century Financial warned that its effort to liquidate assets could be stymied if GE Capital was allowed to proceed with plans to seize computers and other equipment it leased to the bankrupt housing lender. GE Capital, arguing that New Century owes it $8.7 million on leased equipment and can't stay current on payments, asked a judge to lift the protection normally granted to companies in Chapter 11. That would enable the firm, a unit of General Electric, to repossess the equipment, which includes computer servers, and chairs. New Century said that would disrupt its effort to wind down operations and repay creditors. New Century said "much of the data and information" involving its assets and business operations, including accounting information, is stored on the computers, or generated by them. New Century also said "it is critical for the debtors to use the equipment" so that the loan-servicing business it recently sold to Carrington Capital Management can be kept "operating as a going concern." Carrington paid $188 million for the business.[9]

March 26, 2008. An unsealed report by bankruptcy court examiner Michael J. Missal[10] outlined a number of "significant improper and imprudent practices related to its loan originations, operations, accounting and financial reporting processes," and accused auditor KPMG with helping the company conceal the problems during 2005 and 2006.[citation needed]

December 7, 2009. Federal regulators sued three former officers of New Century Financial Corp., accusing them of misleading the company's investors about the company's prospects, as pervasive bad acts in the mortgage industry began to become widely known.[11]

July 31, 2010. The Los Angeles Times reported that settlements had been reached between the SEC, plaintiffs representing a class of investors, and directors and officers of New Century.[4] The SEC settlement, which involved an action brought by the SEC against three officers of New Century (Brad Morrice, Patti M. Dodge and David N. Kenneally), barred them from serving as directors of public companies for five years, and levied fines and profit-disgorgement on them. None of the defendants admitted any wrongdoing.[12] The directors of New Century were not sued or barred by the SEC. On the same day the SEC settlement was announced, New Century, and its directors and officers settled civil class actions claims brought against them and the company. The same three officers listed above were parties to that civil settlement, as were the following former directors of New Century: co-founder Robert K. Cole, the estate of co-founder Edward Gotschall, Fredrick J. Forster, Michael M. Sachs, Harold A. Black, Donald E. Lange, Terrence P. Sandvik, Richard A. Zona, Marilyn A. Alexander, David Einhorn and William J. Popejoy.

March 2008- During the liquidation of New Century Financial Corporation a private company in Northern Illinois acquired only the brand assets in the bankruptcy. New Century Financial held several brands including Home123. The brand Home123 was reintroduced to the market as a real estate marketing and technology firm focused on bringing people, resources, and information together. The marketing and technology platform is intended to allow home service providers, such as real estate professionals, mortgage companies, attorneys and home improvement providers, to work more closely together. Compound marketing and referral based lead sharing are the driving force behind the platform. The New Century brand is currently being positioned for sale.